Home Prices Exceed Expectations at Repeat All-Time High

Prices rolled along to a 32-month high in the S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, increasing from 5.6 percent the month prior. The Index’s 10-City Composite rose 5.2 percent, while its 20-City Composite rose 5.9 percent. The 10-City Composite shows an increase from 5 percent the month prior; the 20-City Composite, an increase from 5.7 percent the month prior. Month-over-month, the 10-City Composite rose 0.3 percent and the 20-City Composite rose 0.4 percent.

Of the 20 cities analyzed, Dallas, Texas, overtook recurring top three-ranked Denver, Colo., with prices up 8.8 percent. Portland, Ore., and Seattle, Wash., remained in the top three, with prices up 9.7 percent in Portland and up 12.2 percent in Seattle. The majority of cities analyzed showed higher increases than what was observed the month prior.

According to S&P Dow Jones Indices Index Committee Chairman and Managing Director David M. Blitzer, the price parade will keep marching on so long as supply trails demand.

“Housing and home prices continue to advance,” said Blitzer in a statement. “The S&P Corelogic Case-Shiller National Home Price Index and the two composite indices accelerated since the national index set a new high four months ago. Other housing indicators are also advancing, but not accelerating the way prices are. As per National Association of REALTORS®, sales of existing homes were up 5.6 percent in the year ended in March. There are still relatively few existing homes listed for sale and the small 3.8-month supply is supporting the recent price increases.

“Housing affordability has declined since 2012 as the pressure of higher prices has been a larger factor than stable to lower mortgage rates,” Blitzer said. “Housing’s strength and home-building are important contributors to the economic recovery. Housing starts bottomed in March 2009 and, with a few bumps, have advanced over the last eight years. New-home construction is now close to a normal pace of about 1.2 million units annually, of which around 800,000 are single-family homes.

“Most housing rebounds following a recession only last for a year or so,” said Blitzer. “The notable exception was the boom that set the stage for the bubble. Housing starts bottomed in 1991, drove through the 2000-2001 recession, and peaked in 2005 after a 14-year run.”

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